But the funding was approved after then-premier Mike Rann made representations to Canberra.

Liberal Senator Simon Birmingham, who initiated the investigation, said there had been a vote-grabbing exercise by Labor.

"Without any consideration of the fact that it would leave Adelaide saddled with a white elephant of a desalination plant, leave Australian taxpayers with even bigger debt to fund in the future and leave South Australians with significantly-higher water prices in the long-term," he said.

"The report demonstrates that the Labor government did not follow its own grants processes, ignored the fact that this project had been rejected by Infrastructure Australia, overlooked the fact that it had failed a cost-benefit analysis."